Customer Satisfaction Process Evaluation Instead of Performance-Centered KPIs
WM Headquarters' Net Operating Income Increased Despite Overall Poor Performance Last Year
The number of high-net-worth individuals managed by NH Investment & Securities nearly doubled over the past three years. The WM Division's profits also increased. It is analyzed that the process value evaluation system, which NH Investment & Securities CEO Jung Young-chae introduced abruptly to the WM Division in 2019, had an impact.
According to NH Investment & Securities on the 31st, the number of high-net-worth individuals managing financial assets of 100 million won or more reached 163,000 at the end of last year. The number continuously increased from 92,000 in 2019, to 159,000 in 2020, and 205,000 in 2021. Although the number of high-net-worth individuals slightly decreased to 163,000 last year due to consecutive interest rate hikes, it is still 1.8 times higher than in 2019.
During the same period, net operating income from financial product commissions also increased from 81.1 billion won (2019) → 80.4 billion won (2020) → 101.2 billion won (2021) → 93.5 billion won (2022) compared to 2019. NH Investment & Securities experienced an 'earnings shock' last year with operating profit and net income of 521.4 billion won and 302.9 billion won, respectively. Operating profit in 2019 was 787.2 billion won. In this context, the increase in WM net operating income last year appears even more remarkable.
The WM Division's progress is largely attributed to the personnel evaluation system introduced by CEO Jung. In June 2019, Jung changed the employee evaluation system to a CRM method. The previous profitability-centered evaluation system, the Key Performance Indicator (KPI), was abolished. The CRM method had long been used in the IB Division. Employees record how many customers they met and enter detailed customer-related information into the computer system.
This is ultimately a strategy to build deep relationships with customers. When WM Division employees input detailed customer information, the person in charge evaluates the partnership with the customer. If the employee judges that their style does not match the customer’s, they introduce the customer to another employee who is likely to communicate better.
It is known that CEO Jung also put effort into the computer system to apply the CRM evaluation method. Otherwise, it could have easily degenerated into a simple qualitative evaluation. The methods of information entry, fact verification, and collaboration were systematically computerized. It effectively created a database of employees’ 'sales information.'
There were quite a few side effects and complaints in the early stages. Some employees falsely recorded customers they had not even met. At that time, no other securities firms used the CRM method for personnel evaluation.
However, as the WM Division staff experienced changes on the ground, they began to evaluate the CRM system positively. Even if the person in charge changed, accurate handover became possible. Especially, the ability to anticipate what customers want in advance stood out as an advantage.
As the system settled, cases of false entries decreased. A system to filter out false reports was also created. Positive feedback from customers increased. In the past, performance-oriented evaluations focused on selling more products or generating profits, but with the shift to relationship-centered evaluations, the focus is on providing sustainable asset management services.
An NH Investment & Securities official said, "Customers using WM want to receive tax-saving or asset management guidance even if they have to pay for it," adding, "For example, when hearing that a customer in their 50s is preparing for their child's study abroad, we connect them with a foreign exchange expert, or provide customized services such as reviewing the STO (Security Token Offering) market and regulatory directions for customers interested in fractional investment, which has also increased customer satisfaction."
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